Child Support Payments or Emergency Savings? A Parent’s Anguish

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6 second take: When you live in near-poverty and owe child support, saving any money can seem insurmountable. But it can be done — $1 at a time.

Child support payments affect parents every day. Do we not find it strange that a court determines that one child needs $1,125 a month to live, while a couple of other children are given $200 a month?

This is not to say that a parent shouldn’t pay child support. But the question I want to ask is, “How does this system directly affect those who are marginalized?”

Those who only make enough to be classified as living in poverty are already marginalized. Having their already small paychecks garnished may keep them impoverished forever.

How States Determine Child Support Payments

A majority of states use the income shares model to calculate child support. For example, Jordan and Pat live in New York and have a daughter named Savannah who lives with Jordan. Their combined income is $4,500 per month, and Pat earns about 55 percent of that, while Jordan earns 45 percent. The court has estimated that the cost of raising Savannah is $1,125 a month, and splits that 55-45 between Jordan and Pat based on their incomes. That means Pat owes Jordan $618 a month in child support payments.

Small Income, Large Child Support Payments

Marc has a part-time job paying $15 an hour. He works 20 hours a week, netting approximately $1,200 per month. He pays $300 a month in child support for his two kids who live with their mother in another state. So his monthly take home is $900. He can only afford to pay $350 a month for a room in a house that he rents, plus splitting the utilities with the other residents.

Enter transportation and food, and Marc has no money left at the end of the month.

Jon, meanwhile, is a single father of three. His oldest daughter is an adult, so he is no longer required to pay child support for her. He has custody of his middle daughter, but owes the state back child support on her because her mother was in government housing when she had custody of her. The state makes the father pay them for that service, which is $200 per month. He is currently paying that much in child support for his youngest son, which is the maximum.

Jon makes $13 per hour as an auditor for the county. After taxes, he nets approximately $1,800 each month. Once child support is taken out, it’s closer to $1,400. For a two-bedroom apartment for his daughter and himself, he pays $625, which is not in the best neighborhood. Add in utilities, food, and transportation cost, and he doesn’t have much to save.

How to Start Saving, Despite Financial Hardship

What can be offered to these individuals to help them build a life of financial wellness? It’s worth considering the difficulties faced by parents in poverty paying child support, as well as the challenges of raising children. They also need to save more money for their future and the future of their children. Often the answer is to get another job or otherwise make more money. Those are both great solutions if you are paying the maximum for that state. If not, you could end up paying more.

My advice would be to start small. Parents facing extreme financial difficulties might find it impossible to think of keeping some money aside for themselves or for their children. Still, it’s very critical that they do. To start small, you can download the Stash app which allows you to set aside a dollar here or $5 there that could grow into a decent sum. This could become useful in emergencies like a flat tire or a dead car battery — or even better, a weekend with the kids.

Supplementing your income is a great way to help your savings. For example, driving with Uber is a good way to get money, but not the only one. Check out our side hustle blogs for some really great ideas! Additionally, cutting costs for every day expenses, like clipping coupons for groceries from sites like SavingStar can help you shave a few dollars off your recurring expenses and use that money for savings!

Starting small will help build the habit of saving over time and build momentum, which will make you want to save even more. For those struggling to make ends meet while paying child support, they may not max out their retirement account in those 18 years. But the idea is to start a new habit of saving.

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